External consultants make hay as MoD farms out work

Spending on external consultants and contracts in the Ministry of Defence is spiralling out of control, while ministers press ahead with raiding the pay and pensions of their staff, the Public and Commercial Services union says.

An independent audit of a contract in the MoD’s procurement organisation – Defence Equipment and Support, based at Abbey Wood near Bristol – found a lack of scrutiny and competition and no attempt to use existing defence staff to undertake the work.

The findings come as PCS staged a protest outside Abbey Wood to highlight the fact that the 6,000 MoD staff at the site stand to lose almost GBP 14 million as a result of the government’s cuts to pay and pensions, according to new research by the union.

The research shows the loss in the value of pay and pensions – as a result of the public sector pay freeze, the increase in pension contributions and other changes to pensions – averages GBP 2,300 for each civil servant.

The October 2010 strategic defence review, led by former defence secretary Liam Fox, was supposed to drive down defence costs. But external expenditure has rocketed from GBP 331 million in September 2010 to GBP 770 million in September this year.

The review also means 32,000 MoD civilians and more than 25,000 military personnel face losing their jobs.

Last month Cabinet Office minister Francis Maude claimed the government was doing all it could to “address waste and increase scrutiny on government expenditure”, adding: “We need to be able to show taxpayers that every penny we spend is being used efficiently and we must open up our books so people can see for themselves where their money is going.”

The union has asked several times for full disclosure and details of all MoD external expenditure, but to date this information has not been released.

The audit into the ‘framework agreement for technical support’ in the DE&S’s, which provides equipment and support to the frontline, found:

“Project teams failed to submit business cases for mandated independent scrutiny and approval in over half of the cases reviewed.”

“A significant proportion of tasks were placed single source (75%) despite the default position being competition.”

“The required investigation into the use of internal resources for completion of the task was not fully completed in any of the tasks reviewed.”

“There was no mechanism to identify where the same skills were being consistently bought in to enable and inform reviews of in-house capacity/capability.”

PCS general secretary Mark Serwotka said: “We have been thwarted at every turn in our attempts to uncover details of the MoD’s external spending, despite ministers’ promises that there would be more scrutiny and transparency for taxpayers.

“Instead of investing in their staff, ministers are choosing to raid their pay and pensions and line the pockets of already wealthy multinational defence giants.”